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Homebuying: Fall is the new spring

While most homebuyers and sellers recognize that spring is the
traditional homebuying season, there are psychological and
financial motivations that create a fall homebuying season. While
the fall real estate market is not traditionally as robust as the
spring market, there is a different dynamic that drives autumn
sales.

"We've observed in seasonal household buyer patterns that there
is a higher ratio of first-time buyers and childless couples in the
fall," Walter Molony, economic issues media manager at the National
Association of Realtors in Washington, D.C., said in an email.
"Families with children time their purchase based on school-year
considerations, so they peak in the spring and summer.
Month-to-month median homes prices typically peak each June or July
(purchases dominated with families with children buying larger
homes) and decline each September (purchases of smaller homes by
first-time buyers, etc.)."

ERA Real Estate, a global real estate franchisor, recently
surveyed its network of over 30,000 brokers and agents about
fall homebuying trends
to see what drives real estate activity in that season.

"A lot of people see Labor Day as the beginning of a new year,
when the summer holidays are over and everyone goes back to school
and back to work," says Charlie Young, president and CEO of ERA
Real Estate in Parsippany, N.J. "The real estate market picks up
because buyers who are planning to move want to be done by the
holidays. Some people are also driven by the idea that they want
the tax benefits of homeownership this year rather than next
year."

The ERA survey showed that 20 percent of buyers are emotionally
motivated by being in a new home for the holidays, while 10 percent
are motivated by
tax benefits
.

"People buy and sell homes mostly because of lifestyle needs
that are present in every season," says Young. "Things like a job
change, marriage, divorce, death, a growing family or a downsizing
family are what drive a home purchase more than the season."

Who's buying during the fall?

According to the ERA survey results, the buyer mix in the fall
typically consists of:

Advantages for fall buyers

Shaun White, vice president for corporate communications for
Re/Max LLC in Denver, Colo., says the advantages of buying in the
fall include highly motivated sellers and less competition.

"Some sellers will opt to lower their price in the fall because
they're afraid of missing the boat and being stuck trying to sell
during the holidays," says White. "Buyer traffic drops in the fall,
too, so buyers may have less competition as well as better prices.
You find motivated sellers and motivated buyers in the fall,
especially as you get closer to the holidays," he says.

Market differences

In some markets, such as Florida and Arizona, the prime selling
season begins in the fall, says White.

"You'll usually see a run-up in sales in those markets where the
buyers are snowbirds coming from colder climates," says White.
"They'll start looking to buy when they first arrive for the
season."

But John Heithaus, chief marketing officer for Metropolitan
Regional Information Systems (MRIS), the nation's largest multiple
listing service covering much of the Mid-Atlantic region, says his
firm isn't seeing a big fall resurgence this year.

"It may be that Washington, D.C. in particular is laying low
because of the election, but mostly the problem is the lack of
inventory," says Heithaus. "Inventory is down 25 to 30 percent over
historically normal healthy markets and there's no indication that
the shadow inventory everyone has been talking about is showing
up."

Heithaus says the three markets that are showing a resurgence in
sales volume and prices right now are Florida, Arizona and Atlanta,
which normally see an uptick in the fall. Those are also three
markets that saw a steeper decline than many other housing
markets.

"All real estate is local, so buyers and sellers really need to
understand their local demographics and look at things like how
long homes are staying on the market and what's happening with
local prices more than a seasonal market shift," says Young.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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